US media: Many media companies in the United States are forced to lay off employees

Turbulent times have just begun for the American media industry. The massive layoffs are just one of the signs that turbulent times are just approaching for the American media industry, or, in other words, may just be the tip of the iceberg. At present, the main reasons for the impact on the US media industry are as follows: First, the shift to streaming media has been hindered. In the past few years, many entertainment companies have invested heavily in streaming media services. Now these expenses have dragged down the financial situation. The Walt Disney Company, Warner Bros. Discovery Company and Paramount Universal lost as much as $2.5 billion in the streaming business in the quarter. On November 29, AMC Television Network AG said it would lay off 20% of its U.S. workforce. , the reason is that its streaming media application cannot make up for the losses caused by unsubscribing cable TV services; the second is the loss of viewers and subscribers. According to statistics, cable companies are now losing nearly 10% of their customers every year. Netflix chairman Reed Hastings said: “Linear TV will die in five to ten years”; Disney CEO Bob said: “Linear TV is going to a huge cliff.”; Investment analyst Michael Ney “After Disney’s latest earnings report, it looks like the cliff may be closer than any of us thought,” Sen said. The third is slowing advertising revenue and a gloomy outlook, including concerns about a recession and slowing ad spending , and user growth during the COVID-19 pandemic is now retracing, especially ad sales in traditional media will slow, for example, TV ad sales will shrink by 4%. The overall advertising revenue of digital media has declined, but the growth of giants is strong. The growth rate of digital media giants in 2022 is lower than the average in recent years. According to the indicators of the first three quarters, it is expected that the top two (Google, Meta) will have a combined net advertising revenue in 2022. Growth of 5% vs. 41% in 2021, for the first time ever below overall market growth (+6.6%), their share of global ad sales stagnating at 42% after a sharp and sustained rise over the past 15 years .Meanwhile, the other top 15 media owners Amazon, ByteDance, Microsoft and Apple continue to post strong double-digit growth in 2022.

Cut off the “udder on the bull”. In accordance with the law of survival of the fittest, many major media companies in the United States have adopted cost-cutting and layoff models in a timely manner. In the past week alone, American news agencies, TV networks, film and television production companies and entertainment giants have laid off hundreds of people, including Warner Bros. 400 layoffs; AMC TV network announced 200 layoffs last week, and the company said it would cut about 20% of its U.S. workforce.

Under the Fed’s rate hike rhythm, interest rate fluctuations have begun to affect the capital market and capital flows in the market. New investment is decreasing. Everyone is preparing for the upcoming global recession. Naturally, advertising budgets have decreased, affecting to the survival of media companies. The people in our country should have watched this episode. Before the entire education and training industry was “destroyed”, and when Internet companies were being anti-monopoly, the advertising and budget from the Internet industry showed a precipitous decline. , Many small and medium-sized advertising and public relations companies have closed down in China, and the media’s revenue is also in jeopardy due to the reduction of advertising budgets. This is very similar to what is happening in the United States now.